Standing Orders

Purpose of “Standing Orders”

• For what
• To define the general service conditions or service rules for the workmen employed in industrial
employment as stipulated in the Industrial Employment Standing Orders Act (IESOA), 1946

• To whom
• Applicable to Industrial Establishments employing 100 or more workmen

• Scope
• (a) Classification of workmen (b) Working Hours, shift working, transfers etc. (c) Holidays (d)
Attendance and late coming rules (e) Leave rules (f) Leave eligibility and leave conditions (h)
termination of employment, suspension, dismissal etc. for misconduct (i) Retirement age (j)
Means of redressal of workmen against unfair treatment or wrongful exactions by employer etc.,
Employment Contract Vs Standing Orders - Simplified

• An individual employment contract between an employer and a workman contain special terms
(e.g., Job designation, basic wage / salary, shift working etc.,)

• Whereas Standing Orders are merely a set of “express” and “general” terms governing
employment relationship in the industrial establishments.

• They are nothing more than an extended individual contract of employment, the only difference
being that they apply across-the-board to all “workmen” employed in the establishment.

• While employment contracts are negotiated instruments between an employer and workmen,
standing orders are to be certified by an independent officer (e.g., Labour Commissioner)
representing the government under the provisions of IESOA, 1946.
Application of Standing Orders to IT and ITES Firms

• IT and ITES Organizations had sought exemption from IESOA and

most states granted that exemption in the 1990’s and 2000’s to support
the growth of the industry and generate employment.

• For instance, the 14 year exemption period was over by August 2011 in
Bangalore, the silicon valley of India.

• Karnataka Govt had issued notice to all IT & ITES firms to comply with
IESOA by submitting a draft standing orders latest by 31st December
2012.
Application of Standing Orders to IT & ITES Firms
Application of Standing Orders to IT & ITES Firms

• Out of 4000+ IT and ITES firm operating in Karnataka State, only 120
could file the draft Standing Orders to the Labour Department.

• Most firms were asking for an extension even as they lobbied with the
State Govt to customize the provisions of IESOA for IT & ITES
industry.

• Many big IT & ITES firms were reluctant to comply with the IESOA
act fearing that it would create unions in the industry.
Fear of Union? How?

• On receipt of the draft under Sec. 3, Certifying Officer shall forward a copy
thereof to the trade union, if any, of the workmen, or where is no such trade
union, to the workmen in such manner as may be prescribed, together with a
notice in the prescribed form requiring objections, if any, which the workmen
may desire to make to the draft standing orders to be submitted to him within
fifteen days from the receipt of the notice [Sec 5 (1) of IESOA, 1946]

• After giving the employer and the trade union or such other representatives
of the workmen as may be prescribed an opportunity of being heard, the
Certifying officer shall decide whether or not any modification of or addition to
the draft submitted by the employer is necessary orders certifiable under this Act,
and shall make an order in writing accordingly [Sec 5 (2) of IESOA, 1946]
Legal Status of Certified Standing Orders

• “IESOA has made relevant provisions for making standing orders

which, after certified, constitute the statutory terms of employment
between the industrial establishments in question and their employees.
That is the principal object of the Act.”
- By Gajendragadkar, J. in Bagalkot Cement Co Ltd Vs RK
Pathan (1963)
Role of Employer’s Association
Conditions for Exemption from IESOA, 1946
1. The establishment shall constitute an Internal Complaints Committee as per the Sexual
Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and
the rules framed thereunder.

2. The establishment shall set up a Grievance Redressal Committee to address complaints of

employees in a time bound manner.

3. The establishment shall intimate the jurisdictional Deputy Labour Commissioner and the
Commissioner of Labour, Karnataka about cases of disciplinary action, suspension,
discharge, termination, demotion, dismissal, etc., of its employees.

4. The employer shall ensure prompt submission of any information regarding the service
conditions of the employees sought by the jurisdictional Deputy Labour Commissioner or
Commissioner of Labour, Karnataka.
Certification of Standing Orders
Certification of Standing Orders
Is “Go-slow” on par with Strike?

• A “Go-slow Committee” was constituted by Bihar Central Standing Labour Advisory

Board after independence to inquire into this pernicious practice by workers.

• The committee submitted the following “recommendations” in 1951

• “Go-slow” by workers should be treated on par with strike
• Workers should not resort to “go-slow” without at least 7 days notice
• The notice would remain in force for 4 weeks
• However, it would not be necessary to notify the exact date of starting ‘go-slow’.
• The workers should not resort to ‘go-slow’ during the pendency of a conciliation proceeding.
• The conciliation proceeding must, however, be concluded within 4 weeks of the ‘go-slow’ notice.
• “Go-slow’ due to malpractices by the management would be justified.

• Resolution by the Bihar state government

• “The govt of Bihar were pleased to accept the recommendations of the committee and expressed
their thanks to the members of the committee for the well-considered report”
“Go-slow is not a Strike but…”

• “’Go-slow’ which is a picturesque description of deliberate delaying of production by

workmen pretending to be engaging in the factory is one of the most pernicious practices that
discontented or disgruntled workmen some time resort to.

• It would not be far wrong to call this dishonest. For, while thus delaying production and
thereby reducing the output, the workmen claim to have remained employed and thus be
entitled to full wages.

• Apart from this also, ‘go-slow’ is likely to be much more harmful than total cessation of work
by strike. For, while during a strike much of the machinery can be fully turned off, during the
‘go-slow’ the machinery is kept going on a reduced speed which is often extremely damaging
to machinery parts.

• For all these reasons ‘go-slow’ has always been considered a serious type of misconduct.”
By Das Gupta, J in Bharat Sugar Mills Vs Jai Singh, (1961)
“Go-slow is a Breach of Contract of Employment”

• “There cannot be two opinions that ‘go-slow’ is a serious misconduct being a covert
and a more damaging breach of the contract of employment.” – Sawant J, in Bank of
India Vs TS Kelawala, (1990).

• It is an insidious method of undermining discipline and at the same type a crude device to
defy the norms of work. It has been roundly condemned as an industrial action and has
not been recognized as a legitimate weapon of the workmen to redress their grievances.

• In fact, the model standing orders as well as the certified standing orders of most of the
industrial establishments define it as misconduct and provide for a disciplinary action for
it.

• Hence once it is proved, those guilty of it have to face the consequences which may
include deduction of wages and even dismissal from service.
What is Work-to-Rule?

• Work-to-Rule is an industrial action by discontented or disgruntled

employees by strictly sticking to the employer’s rules to limit their
output to express their grievances

• For instance,
• Train Drivers taking time to check the engines to “satisfy” themselves that the
engine is in proper order (UK)
• Train Drivers checking every bridge for safety (France)
• Postal workers weighing every letter or parcel for assessing proper postage
(Australia)
Is Work-to-Rule a Breach of Contract?

• British train drivers union argued that “how can there be a breach of
contract when we are complying with the employers’ own rules”?

• So the question to be decided by the court is ““Can complying with

your employer’s rules be a breach of your employment contract?”
Is Work-to-Rule a Breach of Contract?

• “Those rules must be construed reasonably…  It is only when they are construed unreasonably that the
railway systems grinds to a halt.   It is, I should think, clearly a breach of contract first to construe
rules unreasonably, and then to put that unreasonable construction into practice….  The meaning
of the instruction [to strictly obey the rule book] is not in doubt.   The instruction was intended to
mean, and it was understood to mean, ‘Keep the rules of your employment to the very letter, but, whilst
doing so, do your very utmost to disrupt the undertaking’.  Is that a breach of contract?…

• If [an employee], with others, takes steps wilfully to disrupt the undertaking, to produce chaos so that it
will not run as it should, then each one who is party to those steps is guilty of a breach of his contract.
 It is no answer for any one them to say ‘I am only obeying the rule book’…  That would be all very
well if done in good faith without any wilful disruption of services; but what makes it wrong is the
object with which it is done.”

By Lord Denning in Secretary of State for Employment vs ASLEF (1972)

Implied Terms of Contract of Employment

1) To be regular and punctual

2) To work diligently for the exclusive benefit of the employer
3) To use reasonable care and skill
4) To obey the lawful orders of superiors
5) To take proper care of employer’s property
6) Not to accept employment anywhere while being in the service of the employer
7) Not to set up any business which is similar to, or the same as, that of the
employer
8) Not to part with the trade / business secret of the employer; and
9) Not to do anything that would harm the interests of the employer or his
business.
Expansive reading of the term “Strike” in other Jurisdictions (Not in India)

• “Strike” includes a cessation of work, a refusal to work or to continue

to work by employees in combination or in concert or in accordance
with a common understanding, or a slow-down or other concerted
activity on the part of employees designed to restrict or limit
output;” [Sec 1 of Labour Relations Act, 1995, Canada]